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Tuesday, February 25, 2014

Interview with Ryan Stoops at Open Scan Technologies, Inc.

Please join me as I continue this blog series on Accounts Payable Automation. Today I am speaking with Ryan Stoops with Open Scan Technologies Inc.

Ryan, what makes Open Scan's product different from other A/P automation products?

Just to give you a little background, our core product is actually a receivables product. In the last couple of years, we decided to fill out the rest of our offering with an AP solution. What we did different was to take our core competencies from AR and applying it to AP. One of them is the data capture portion of it.

We have a different way of capturing data than a lot of companies. Other companies train their system to look for certain pieces of information on the image of the document. That’s how they build their templates, and this is a technical task that you’d have an I.T. person do.

What they do is take an invoice that comes in every month from a particular company, and take about twenty of those images, scan it, and run it through their system. That can take an hour. Eventually, the system will learn to look for certain things on that paper that matter from that companies invoice.

Ours takes about twenty seconds. What we do is draw boxes around the data that we want, and then we use a similar system, in a sense, to identify who it is from. When it comes to taking the data off of a page, and knowing what the data is, and where it goes in the system, that’s a differentiator for us. We call it roping and zoning, which is basically drawing little boxes around it real fast. This is to limit what the computer needs to look at on the page.

Ryan Stoops

Another type of differentiator we do is take in all electronic invoices such as from emails or any type of document from word, excel, or pdf. We turn them into an image and then put it back into the system. Not everyone does this yet so that another differentiator we found. Also, we are end to end, and I’m sure you talked to other vendors which do only one part of it, and so actually because we do end to end for AR we decided to go ahead and just apply all the technology we do with AR and just go from capturing it, all the way to approval, all the way to sending it to the ERP. But where we stop though is we don’t issue the check. That is where ERP really shines anyway. So, literally from the time you receive either an email or paper document, all the way to approval or three-way matching we are end to end. So that is really one of the major differentiators.

Is dynamic discounting part of the program?

Currently, we do not offer that functionality, but it is on our roadmap. In fact, we are well positioned to do this in the future because we have an A/R product that can complete the negotiations.
What we do offer is prompt approvals and electronic approvals. If you chose to, let’s just say its net 10, historically if you’re working with paper you will be lucky to even get it approved in the first 20 days because of paper shuffle. One of the benefits that we encounter is if there is a discount that is to be taken this allows you to get the approval done in a matter of hours to days to get the payment out.

Is Open Scan Technologies, Inc. an American company?

Yes, we are located in the middle of Colorado; we have been in business for 15 years. We have been doing AP for about 3 but we have been doing AR for 15 also working with states, governments, etc. but our core competency is AR. We are merging into the market for AP and are working right now on taking our on-premise solutions and putting it in a cloud. That is where we are going with it within the next 6 months or so.

How many clients in North America and abroad?

We focus on North America; of course, companies aren't really necessarily just because they are based here built longer than businesses overseas. We are really Canada and North America and we are looking at 75 companies but the majority of them literally like 80% of them are Fortune 500. So that is kind of where we sit with it. We tend to do business as far as your company just because the cost benefit makes more sense when they have more volume. We are looking to go down market for both products, when I say that I mean when you are fully web based then you can service more clients with fewer implementation costs.

Is there a particular ERP system that works best with Open Scan?

Actually, that is another differentiator, we are certified as an ERP partner but in the beginning, we intentionally designed our products to be agnostic. So when I say that a lot of companies will do custom APIs with different ERP members. The way we looked at it was to keep it the kiss methodology, keep it simple. So what we do is basically file hand off. So when were done with our work we take the data images we put it in the directory which we basically tell the ERP to do this in an automated fashion once a day when the ERP goes out to pull that file. We actually did that intentionally because first of all a lot of I.T. people don’t want you to tightly integrate with their ERP because that means you’re messing with their databases and it allows us to work with any ERP.

What about outsourcing or off-shoring?

As far as outsourcing or off-shoring the answer is no, but both our products are actually built to be used in a business process outsourcing like model. We haven’t had a lot of play with it but we have a lot of shared services. For instance, clients who have multiple divisions where they put all the accounting work into one location. It’s kind of like outsourcing but you are really in-sourcing. With the outsourcing model, two reasons we haven’t seen a lot of play with it, mainly is you are dealing with the finances because outsourcing is something like customer service which is one thing but when you are outsourcing, issuing a check or the approval of issuing a check not a lot of people are comfortable with putting that in somebody else’s hands that are not in the country. It is a loss of control and one of our companies did actually outsource to India and ended up spending more money sending out supervisors over there for periods of time which was basically a loss of money and they actually brought it back to the states because they felt like A) they didn't have control and B) the people overseas aren't invested in doing the job right. They had to constantly send over supervisors to make sure they were doing the work right. So that was our experience with it. The answer is yes it’s completely built for and could be outsourced but we don’t offer the particular program for that.

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